Minister for Trade and CompetitivenessMinister Assisting the Prime Minister on Asian Century PolicyMinister for Tertiary Education, Skills, Science and Research

The Hon Dr Craig Emerson MP

Intervention at the G20 Trade Ministers' Meeting

19 April 2012

Intervention at the G20 Trade Ministers' Meeting

Puerto Vallarta, Mexico

Speech, check against delivery

19 April 2012

Bruno [Ferrari, Mexican Economy Minister], I would like to begin by very sincerely thanking you for putting together a very well-considered and creative agenda for this first meeting of G20 Trade Ministers. It is an agenda that represents the interests of developing, emerging and developed countries, and the least-developed countries. So, thank you very much because this agenda is contributing to a very positive discussion around the table.

In respect of industry protection, the Australian experience is that we spent a lot of time playing with that: from before the Second World War through to the mid-1980s Australian governments erected higher and higher trade barriers. But from the mid-1980s we began to dismantle them, to the point that they are very low and virtually non-existent. The consequence of that for Australia has been that we've enjoyed 20 years of recession-free economic growth and strong job creation.

In this regard, we've travelled a similar path to many countries seated around the table. Just to name a few: Korea, Singapore, New Zealand, Chile, Colombia, Peru, Mexico, and China — and that's not an exclusive list. And the experience of all of those countries is that it has strengthened our economies, made them more resilient, led to more growth, led to greater prosperity, and led to more jobs. Trade liberalisation leads to more jobs.

Previous speakers talked about mythical countries and actual countries and families having to leave those countries. Well, no family has had to leave Australia — because of that experience of the creation of not only more jobs but better jobs.

So I ask rhetorically: what are the sources of sustainable economic recovery in the aftermath of the global recession? Is it fiscal policy or government spending? No: debt-ridden countries cannot do more of that. Is it monetary easing? No: that's run its course. In any event, fiscal policy and monetary easing are never sources of sustainable economic growth.

That leaves trade liberalisation. If there's a fourth source of sustainable growth, let's discuss it. I just don't know what it is. So, I put to this group that it is trade liberalisation.

The G20 Leaders' Meeting held last year did make an anti-protectionist pledge. But the truth is that following that anti-protectionist pledge there have been new protectionist measures. Protection overall has gone up.

In a world with increasing protectionism, or at least no liberalisation, we are left to argue about the distribution of a fixed number of jobs, or even a declining number of jobs around the world. Therefore, our argument is that we need further liberalisation as a spur to job creation.

I am very happy to hear the discussions this morning from [WTO Director-General] Pascal Lamy and many countries debunking the myth that exports are good and imports are bad. We really need to embrace this notion. We have in Australia.

Low-cost imports, many of them from China, have reduced the cost of living in Australia. They have reduced the cost of living for the poorest people in Australia. This is good. This is not bad. This is good. Some producers may complain, but consumers are happy. And, overall, the country has benefitted from inexpensive imports - that is those that are cheaper than can be produced in Australia.

Now, at our meeting in December at the MC8 we agreed that we would look at fresh and credible approaches or, in Australia's language, "new pathways". And trade facilitation seems to be the prime candidate. Again, 44 per cent of the benefits of the whole Doha Round are estimated to emanate from this one initiative: trade facilitation. And two-thirds of those benefits would accrue to developing countries. Therefore, I would like to deal with the suggestion that trade facilitation is an agenda for developed countries and big, wealthy corporations. It is in fact an agenda that is designed to benefit mostly developing countries.

Now, how would we explain to the next meeting of G20leaders that we did not make progress on trade facilitation? On what basis could we explain as trade ministers that this was impossible?

So, I'm urging that we commit to bringing the negotiations on trade facilitation to an early and successful conclusion. One proposal that is not yet agreed in relation to the least developed countries is that they can join now. And as their capacity is built over time to participate in the trade facilitation measures they can activate their commitment, having signed the agreement. That's not agreed yet; but it is certainly something that I think is worthy of very positive consideration.

I'd also like to make clear on Australia's behalf that the concentration on trade facilitation does not mean we have abandoned by any means the other elements of the Doha agenda. We are already pursuing services trade liberalisation. We want agricultural trade liberalisation. We want the other measures and issues to be resolved. But if we are in a world where we have to wait for NAMA [non-agricultural market access] to be resolved, for agriculture to be resolved, before we are able to resolve trade facilitation then we are putting it off indefinitely. And I think that would be a tragedy for the whole of the World Trade Organization, and particularly for some of the most vulnerable countries who are members of that organisation.

So I conclude by saying I believe the discussion here, Bruno, under your chairmanship, has been more positive and pleasingly positive; more positive than in other meetings that I've attended of trade ministers in different forums and in different formats. And I would ask that we take this positive sentiment that has been developing throughout the day back to Geneva; carry it into the attitude of our negotiators in Geneva and begin to bring some elements of the Doha Round to a successful conclusion, with a clear emphasis, with a clear priority on trade facilitation.